Flexible and adaptive accrual method and apparatus for calculating and facilitating compliance with taxes and other obligations

ABSTRACT

A computer-based system and method calculates and facilitates revenue accrual, for making larger, less frequent payments of estimated taxes or other obligations. Payer preferences are applied to satisfy variable payment intervals, amounts, and available resources. The obligation, required payments, and set-aside schedules are recalculated as needed, under payer and/or system control. Excess accruals are minimized; set-aside schedules are configurable. The system may be self-contained, handheld, or accessed remotely. Automatic datalinks move information and command fund transfers from the payer&#39;s bank, to accrue funds and make payments to other accounts. A service host may support a plurality of payers to make set-asides and payments at various levels as needed, on an individual or batch basis, including individual taxpayer enrollment for batch file tax payments by service providers. Some embodiments can be embedded to enhance the capabilities of other systems.

RELATED APPLICATIONS

This application is a continuation of co-pending U.S. application Ser.No. 12/576,595 filed Oct. 9, 2009. Application Ser. No. 12/576,595 is acontinuation-in-part of U.S. patent application Ser. No. 11/623,083,filed Jan. 14, 2007, which claims the benefit of U.S. ProvisionalApplication No. 60/862,474, filed Oct. 23, 2006. Application Ser. No.12/576,595 also claims the benefit of U.S. Provisional Application No.61/103,949, filed Oct. 9, 2008. All of these applications areincorporated herein by reference in their entirety for all purposes.

FIELD OF THE INVENTION

The invention relates to systems and methods for facilitating thepayment of financial obligations, and more particularly to facilitatingcompliance with estimated tax payments and other financial obligations.

BACKGROUND OF THE INVENTION

In the United States, the Internal Revenue Service (IRS) reports thatemployees having payroll income with mandatory withholding amountsdeducted from their pay are 98% tax compliant, clearly demonstratingthat systematic set-asides of tax liabilities on a frequent, periodicbasis, typically every week or every two weeks, almost entirely relievestaxpayers, and their accountants, of the wasteful and worrisome burdenof delinquencies, penalties, enforcements, and workout plans. Incontrast to this scenario, the IRS estimates that out of the 29 millionself-employed individuals in the United States, only 40% are compliantin paying their estimated taxes in full and on time.

The direct financial consequence of non-compliance is illustrated in thefollowing table, which is based upon a single U.S. resident,self-employed, using the standard deductions for tax year 2007, whomakes no estimated tax payments:

TABLE 1 Income Tax IRS Underpayment Penalty $30,000 $6,717 $306 $50,000$12,990 $588 $100,000 $31,810 $1,448

There are also indirect, quality-of-life consequences that can arisefrom estimated tax non-compliance. The IRS can file tax liens and theindividual's credit, reputation, and peace of mind can be impaired. Theindividual may then be afraid to maintain a bank account due to fear ofan IRS levy. It may become difficult for the individual to lease a car,buy a house, or obtain a credit card due to impaired credit. The filingof separate tax returns to keep a spouse's credit clean may result inthe unnecessary payment of thousands of dollars in extra taxes, due tothe bracket break between MFS (married filing separately) and MFJ(married filing jointly). And ultimately, a delinquent taxpayer, out ofdesperation, may stop filing tax returns altogether, and then may becomeliable for additional civil and criminal penalties.

One approach for a self-employed individual is to divide the estimatedannual tax liability into smaller amounts that can be set aside monthly,weekly, or according to whatever set-aside period the individualprefers. For example, the individual can establish a separate set-asidebank account for accumulating estimated taxes, and can arrange for hisor her bank to automatically transfer a fixed amount from a checkingaccount into the set-aside account every week, every month, or accordingto whatever set-aside period the individual chooses. Estimated taxes canthen be paid from the set-aside account as they come due.

This set-aside practice has been recommended to clients by more than 70%of accountants surveyed, yet it is almost never followed, due to manydrawbacks and complications. In the US, estimated tax payments are dueon April 15^(th), June 15^(th), September 15^(th), and January 15^(th).These due-dates divide the tax year into estimated tax intervals whichvary in length from 8 weeks to 18 weeks, or from two months to fourmonths. Therefore, simply dividing the annual tax liability into equal,smaller amounts to be set aside every week or every month will result inshortfalls and penalties in two quarters. The set-aside amount can bemanually recalculated and adjusted for each estimated tax interval, butthis can be burdensome to the tax payer, and will result in significantfluctuations from interval to interval in the amounts transferred to theset-aside account.

In addition, self-employed individuals frequently receive their incomesat unequal and even unpredictable rates, and the total amount of incomefor a self-employed individual's tax year may be difficult to predict.This can lead to frequent adjustment of the estimated tax liability, andfrequent re-calculation of the set-aside amounts, as income fluctuatesduring the course of a tax year. And even if self employment income issomewhat steady and predictable, adjustments may be required aftercalculation and payment in April of the previous year's taxes.

Cash shortfalls may also necessitate adjusting or missing some periodicset-asides, or even underpaying or missing an estimated tax payment, andmay therefore require re-calculation and adjustment of the set-asideamounts. Beginning the set-aside process after a tax year has begun canfurther complicate the scheduling of appropriate set-asides, and mayrequire adjustment of the set-aside amounts so as to compensate forestimated tax payments that have already been missed and/or overpaymentsthat have already been made.

In addition, an individual may be reluctant to accrue funds in advanceof estimated tax payments in case an unexpected need for cash shouldarise, for example due to an unexpected self-employment expense orinvestment opportunity.

For the reasons given above, many self-employed individuals and businessowners (many of whom lack sufficient regimentation and discipline) havefound it too difficult and too burdensome to calculate and set-asideappropriate amounts of estimated tax revenue on a frequent, regularbasis, despite the clear and significant benefits that would be realizedtherefrom. For example: $19.25 per week (which is highly affordable),would add up to over $1,000 dollars at the end of a year (which is farless affordable), yet this approach is rarely implemented.

While the preceding discussion is focused on estimated tax payments,other circumstances can give rise to similar revenue set-aside bestpractices, needs, and difficulties. For example, when income isunpredictable, it can be difficult to calculate appropriate set-asideamounts for payment of child support, alimony, church contributioncommitments, retirement savings, home mortgages, savings accounts,emergency funds, and such like. In other examples, the financialobligation itself may vary, depending on the amount and timing ofcurrent income rather than a prior year income or tax, or on some othercurrent variable such as sales, or even a non-financial variable such asincremental usage of a resource, resulting in a varying obligation thataffects an optimal schedule of payments. In some circumstances, such aschurch “tithing” contributions, the total amount to be paid can dependon a payer's income, requiring that set-aside amounts be adjustedaccording to changes in actual and/or predicted income.

SUMMARY OF THE INVENTION

In one aspect of the invention, there is provided an apparatus andmethod of use thereof which enable a self-employed taxpayer or a payerof another financial obligation to calculate and set aside small amountsof money from an income stream or other monetary source on a frequent,periodic basis in preparation for making larger, less frequent, requiredpayments during a fiscal year or other payment term. This helps to avoidunderpayments and can minimize overpayments and/or payment amountfluctuations under circumstances where the required payment periods,and/or the required amounts due, may be variable.

In another aspect of the invention, a system of the invention can becharacterized as a computer-enabled enterprise system having variouspoints of user interface and account access or control for makingwithdrawals and deposits. The system may incorporate multiple programs,tables, and a synchronizing engine, accepting instructions and datainputs, and executing specialized algorithms that facilitate theautomated satisfaction of obligations according to user preferences.

In still another aspect of the invention, there is provided thecapability for scheduling of different set-aside amounts duringdifferent payment intervals in anticipation of expected changes in thepayer's income and/or ability to pay during the payment term. In yetother aspects of the invention, modification and/or cancellation ofindividual set-asides is facilitated, as well as recalculation andreadjustment of the remaining set-aside schedule, without undue burdento the payer, whenever the payer's estimated total income, rate ofincome, amount due, and/or ability to pay fluctuates during the paymentterm.

Still another aspect of the invention provides for software operable ona general purpose computer, hand-held device, or other programmablecomputing device, the software being accessible to a user either throughan interface provided by the apparatus itself, or by communication withthe apparatus over a network, such as the Internet, to acomputer-enabled host system. The method may include input by the userof an estimated annual tax liability, or another actual or estimatedfinancial obligation, and the required payment intervals therefore,along with other information and preferences relating to satisfying theobligation. In various embodiments, user-specified preferences includeselecting or specifying of a set-aside period such as weekly, bi-weekly,monthly, etc, rounding of payment amounts to the nearest whole-dollar,etc, with a compensating reduction of the last payment of the interval,and choice of whether to minimize the set-aside amounts, which typicallyrequires differing set-aside amounts and/or differing set-aside periodsduring different payment intervals, or to equalize the set-aside amountsand periods, which typically requires that a surplus of funds be setaside during some payment intervals. The system then calculates anappropriate set-aside schedule of dates and amounts, and re-calculatesthem as needed according to updated information provided by the userand/or obtained automatically by the apparatus, for example bycommunication with the user's bank or third party payment service.

In various embodiments, the invention can provide notifications to theuser, for example reminding the user when it is time to set funds aside.These notices can prompt a payer to review and approve or optionally tochange a set-aside amount, delay it for some amount of time, or cancelit entirely. And in some embodiments, the present invention can provideinput data for an online and/or batch payment system, such as isdescribed in U.S. patent application Ser. No. 11/623,083, publicationno. 2008/0097878, hereby incorporated in its entirety for all purposes.In other embodiments, the apparatus of the present invention can beconfigured to provide input data to an existing payroll system, or to anautomatic payment debiting system deployed by a service bureau, taxingauthority (the IRS EFTPS system is an example), or another creditor. Andin yet other embodiments the present invention can be embedded withinanother type of system, such as a creditor's accounting system, so as toenhance the internal capabilities of the system into which it isembedded, such as by calculating, scheduling, notifying, adjustingand/or facilitating debit and/or credit payments.

Some embodiments of the present invention can be configured to acceptadditional information pertaining to a user, such as for payers, emailand street addresses, phone and fax numbers, birth date, social securitynumber or taxpayer identification number, employer identificationnumber, bank account information, adjusted gross income from theprevious year, and such like, so as to enable the embodiment to initiatethe setting up of escrow or holding accounts (which are ofteninterest-bearing), and to establish an electronic payment account with ataxing authority or another creditor. Relevant creditor information canlikewise be accepted into the system so that both parties, payor andpayee, are suitable identified and linked with the respective accounts.This enrollment information feature also enables embodiments to providepre-authorized payment instructions on a payer's behalf to a bank,credit union, brokerage, or other type of account-holding institution,and/or to a taxing authority, creditor, etc.

In certain embodiments the system can communicate with institutions suchas the IRS and/or a user's bank or other financial institution, so as todetect relevant financial events, such as may be or result in changes inthe relevant tax schedule, or taxes or other obligations owed, set-asideamounts missed, insufficient funds to make a payment, bank accountproblems, force majeure, etc. From such information, the system mayrecalculate the remaining periodic set-aside amounts and datesaccordingly. For example, some embodiments are able to automaticallyadjust set-aside amounts based on a bank account balance and/or amountsof deposits and withdrawals that are made to/from the source account,representing the user's available funds. And some of these embodimentsare able to detect and/or initiate catch-up payments for current andprevious quarters and/or years.

Some embodiments provide for special escrow accounts that are able to beconveniently opened, as compared to regular escrow accounts that aremore restricted due to anti-money laundering regulations. Theseembodiments and escrow accounts also serve as a buffer by keepingconfidential source account information details away from taxingauthorities and creditors who may be in an adversarial relationship withthe payer. Certain of these embodiments can provide for the payment ofinterest on funds in set-aside escrow accounts, and can allow for therefunding of accumulated set-aside funds back into the payer's sourceaccount, or a designated further account, at any time, and for anyreason.

Various embodiments are able to provide reports on past activities andfuture actions. Some embodiments provide for updating database recordswithin the system to reflect the change from payments planned, topayments made, including an interim period that may be required forassuring payments made from the donor account have actually cleared, orbeen confirmed, at the receiving account. And some embodiments include arounding feature that enables all set-asides to be in whole dollaramounts, and compensates by adjusting the last set-aside amount of thepayment interval as needed so as to provide the desired total fundaccrual for the payment interval.

In addition to individual payers of taxes and other financialobligations, the present invention includes embodiments applicable touser groups, businesses, trade associations, professional societies, andall types of institutions and business entities that take on largefinancial obligations as payors or payees. Embodiments of the presentinvention are applicable to many types of fixed or variable financialobligations, such as mortgage payments, insurance premiums, retirementplan contributions, and such.

More broadly stated, the invention is applicable to any fixed orvariable obligation for payment by a first party or payor to a secondparty or payee that may be based on any one or combination of thingsincluding but not limited to accrued income, judgment, or contract, suchas for consumption, utilization, or sales of goods or services by thefirst party or another user party for whom the first party isaccountable, where the obligation or payments to the second party may becharacterized as any of taxes, bills, expenses, loan payments,commissions, fees, royalties, contractual satisfaction or the like, theobligation, including the payment terms, being fixed or calculable by aspecified formula, and optionally by performance of the first partyand/or its agents during the interval, with payments typically but notnecessarily due on one or more specified dates over the interval orshortly thereafter. The invention contemplates among its variationsmultiple first parties obligated to a single second party, such as inthe case of taxpayers and a tax authority, and a single first partyobligated to multiple second parties, such as in the case of a singledistributor of goods of several manufacturers who are each creditors, ora household that needs to balance and juggle an income stream to satisfya plurality of creditors. The invention provides improved means ofmanaging this process, including the introduction of computer enhanceddata management and third party facilitators and mechanisms that providemore information and give more latitude and control to the first partypayor for more optimal management of the obligation and paymentsthereunder, all of which makes payment performance more reliable for thesecond party payee or collection service.

The enhanced data management capability of the present invention caninclude the adjustment of amounts, schedule preference, and actualfinancial performance to be governed by a set of pre-determineddecisions and rules. In some embodiments, programmatic implementationsof the RETE algorithm applied to the data management of the invention,in conjunction with the adjustable nature of the invention as describedherein, enable the automated granting of latitude with respect to theobligation and reduction of human collection efforts, as work-out planscan be predetermined and implemented as a set of rules. Case-by-caseindividual and collective experience-based adjustments of work-outpayment arrangements by means of monitoring results and refiningcollection rules further eliminate labor, based reasoning, and adjustingtechnologies, such as inference engines, and ontologies with rationalagents, as two examples.

Embodiments can benefit accountants and other tax professionals who canuse, recommend, and enroll their clients in a user group, as well asbusiness owners, partnerships, networks of business people, and suchlike. Businesses bound by contracts as either payor or payee of suchobligations will likely make extensive use of the invention wheneverflexible and/or adaptive set-asides are beneficial. Federal, State,City, and Municipal Governments, as well as creditors, debt collectionagents, and such like, can also use the invention as a calculation,notification, and/or a collection device, or simply provide the onlineor downloadable use of the periodic set-aside calculator of the presentinvention, as they now do for payroll withholdings. Charitableorganizations can also offer embodiments of the present invention totheir patrons and congregations for tithing and other contributions.

In particular, it can be beneficial to a creditor or to a debtcollection agent to provide use of the present invention to its clients,since the flexibility, adaptability, and ease of implementation of thepresent invention, as well as the ability of the present invention toprovide set-aside schedules that are practical for payers to follow, canaid indebted clients in becoming and remaining compliant with theirobligations.

The present invention is a computer-enabled method for improvingcompliance of a plurality of taxpayers subject to respective estimatedtax obligations to a common taxing authority by use of periodicset-asides of funds sufficient to make required payments in accordancewith terms of the obligations. The method includes using acomputer-based system including a processor, database, at least onetaxpayer interface, and data links to selected financial institutionscontrolling selected financial accounts for:

-   -   establishing and storing in memory for each of the estimated tax        obligations a next available set-aside date and a due date for a        next required payment, the due date being common for all of the        estimated tax obligations;    -   determining and storing in memory for each of the estimated tax        obligations a payment amount for the next required payment;    -   ascertaining and storing in memory for each of the taxpayers        compliance preferences including a preferred set-aside period        and an amount per period to be set aside;    -   calculating and storing in memory for each of the estimated tax        obligations a set-aside schedule as a function of the next        available set-aside date, the due date, the payment amount, and        the compliance preferences, the calculated set-aside schedule        comprising a plurality of set-aside amounts and a plurality of        corresponding set-aside dates, whereby a total of the set-aside        amounts is at least equal to the payment amount;    -   displaying to each taxpayer the set-aside schedule calculated        for the estimated tax obligation applicable to the taxpayer;    -   enabling each taxpayer to accept or adjust the applicable        calculated set-aside schedule and, if adjusted, overwriting the        stored set-aside schedule with the adjusted set-aside schedule;    -   for each of the taxpayers, according to the applicable        calculated set-aside schedule, transferring an amount of funds        equal to the scheduled set-aside amount, on the scheduled        set-aside date, by means of one or more data messages, from at        least one individual source account associated with the taxpayer        to a respective sub-account of a common holding account, wherein        set-aside amounts are combined but accrued on behalf of the        respective taxpayers until the due date;    -   transferring by batch file instructions the combined payment        amount, on the common due date, by means of one or more data        messages, from the at least one holding account to a receiving        account of the taxing authority, with instructions for        apportioning the combined payment among the respective        individual taxpayers; and    -   storing in memory a record of the transferred amount as a        reduction to the holding account and the sub-accounts of the        individual taxpayers and a corresponding reduction to their        respective individual estimated tax obligations.

In some embodiments, the taxing authority is the United States InternalRevenue Service. Various embodiments further include using thecomputer-based system to repeat the establishing, determining,ascertaining, calculating, displaying, and enabling for a plurality ofsequentially required payments and associated due dates.

In certain embodiments at least one of the holding accounts isassociated with at least one of the taxpayers as an escrow account.

Various embodiments further include recalculating the adjusted set-asideschedule based on stored data, displaying the recalculated set-asideschedule to the taxpayer, and enabling the taxpayer to accept or adjustthe calculated set-aside schedule and, if adjusted, overwriting thestored set-aside schedule with the adjusted set-aside schedule.

In some embodiments, determining the payment amount of the next requiredpayment includes entering and storing an estimated total amount for theestimated tax obligation, determining and storing amounts of previouspayments and credits reducing the estimated tax obligation, andcalculating and storing the next payment amount as a function of thetotal amount of the estimated tax obligation less the previous paymentsand credits, and the terms of the estimated tax obligation by whichpayment intervals, due dates and amounts are determinable.

In various embodiments, calculating a set-aside schedule includescalculating each set aside amount S_(n) using an equationS _(n)=(T/I)/P _(i)where the individual set-aside periods are indexed by the variable n, Tis the total amount of the financial estimated tax obligation, the totalnumber of required payment intervals is I, the payment intervals areindexed by the variable i ranging from 1 to I, and P_(i) is the numberof set-aside periods available in the payment interval in which then′^(th) set-aside period occurs.

In other embodiments, calculating a set-aside schedule includescalculating each set aside amount S_(n) using an equationS _(n)=(T/I)(L/D _(i))where the individual set-aside periods are indexed by the variable n, Tis the total amount of the financial estimated tax obligation, the totalnumber of required payment intervals is I, the payment intervals areindexed by the variable i ranging from 1 to I, L is the fixed set-asideperiod length in days, and D_(i) is the number of days in the i′^(th)payment interval.

In still other embodiments calculating a set-aside schedule includescalculating each set aside amount S_(n) using an equationS _(n)=(T/I)(L/D _(i))−(O−Σ ₌₁ S _(j))/(N−K)+A _(n)where individual set-aside periods are indexed by the variable n rangingfrom 1 to N, S_(n) is the set-aside amount for the n′^(th) set-asideperiod, T is the total amount of the financial estimated tax obligation,L is the fixed set-aside period length in days, D_(i) is the number ofdays in the i′^(th) payment interval, O is an overpayment made towardthe estimated tax obligation before the first set-aside date, K is thevalue of n at the first set-aside date, and A_(n) is an individualadjustment made by the taxpayer to S_(n).

In yet other embodiments calculating a set-aside schedule includescalculating each set aside amount S_(n) using an equationS _(n)=(T/I)/MIN(P _(i))where the individual set-aside periods are indexed by the variable n, Tis the total amount of the financial estimated tax obligation, the totalnumber of required payment intervals is I, the payment intervals areindexed by the variable i ranging from 1 to I, P_(i) is the number ofset-aside periods available in the payment interval in which the n′^(th)set-aside period occurs, and MIN(P_(i)) is the minimum value of P_(i)for all values of i.

And in still other embodiments calculating a set-aside schedule includescalculating the length Ln of each set-aside period using the equationL _(n) =D _(i)/MIN(P _(i))where the individual set-aside periods are indexed by the variable n, Tis the total amount of the financial estimated tax obligation, the totalnumber of required payment intervals is I, the payment intervals areindexed by the variable i ranging from 1 to I, P_(i) is the number ofset-aside periods available in the payment interval in which the n′^(th)set-aside period occurs, D_(i) is the number of days in the i′^(th)payment interval, and MIN(P_(i)) is the minimum value of P_(i) for allvalues of i.

Various embodiments further include for at least one of the taxpayers,storing in memory a record relating to a source account associated withthe taxpayer so as to identify an amount of set-aside funds in a sourceaccount equal to the scheduled set-aside amount, on the scheduledset-aside date, by means of one or more data messages, whereby therecord indicates the accrued amount of set-aside funds in the sourceaccount until the due date, transferring the payment amount, on the duedate, by means of one or more data messages, from the source account toa receiving account associated with the taxing authority, and storing inmemory a record of the transferred amount as a reduction to the sourceaccount and a corresponding reduction to the estimated tax obligation.

And in certain embodiments a plurality of source accounts is associatedwith at least one of the taxpayers, said compliance preferences for saidtaxpayer including rules by which set aside amounts are distributedamong said source accounts.

The features and advantages described herein are not all-inclusive and,in particular, many additional features and advantages will be apparentto one of ordinary skill in the art in view of the drawings,specification, and claims. Moreover, it should be noted that thelanguage used in the specification has been principally selected forreadability and instructional purposes, and not to limit the scope ofthe inventive subject matter.

BRIEF DESCRIPTION OF THE DRAWINGS

FIG. 1A is a flow diagram illustrating steps in a preferred embodimentthat transform a non-compliant payer of a financial obligation into acompliant payer;

FIG. 1B is a flow diagram illustrating steps in an embodiment ofobtaining calculation data, calculating a set-aside schedule, makingadjustments, and re-calculating as needed;

FIG. 1C is a flow diagram illustrating a set-aside calculation performedby an embodiment of the present invention wherein set-aside payments aremade at equal intervals, and set-aside amounts are determined bydividing each quarterly payment by the number of full weeks in thequarter;

FIG. 1D is a flow diagram similar to FIG. 1A, except that fractionalweeks are included in the number of weeks by which each quarterlypayment is divided;

FIG. 1E is a flow diagram similar to FIG. 1B, except that set-asides arescheduled for a specific day of the week;

FIG. 1F is a flow diagram illustrating how partial years, underpayments,and overpayments are processed by the embodiment of FIG. 1C;

FIG. 1G is a flow diagram similar to FIG. 1A, except that all set-asidepayments are equal in amount, while the intervals between set-asidepayments are adjusted according to the differing lengths of the paymentquarters;

FIG. 2A is a flow diagram illustrating an embodiment that accepts inputdata from a “level 1” user and calculates therefrom set-aside amountsand intervals under the assumption that the user will separately accruethe recommended side-aside amounts and make the required paymentstherefrom;

FIG. 2B is a flow diagram illustrating an embodiment that includes allof the features of FIG. 2A, and also stores the input data andcalculation results for future reference, while assuming that the userwill separately accrue the recommended side-aside amounts and make therequired payments therefrom;

FIG. 2C is a flow diagram illustrating an embodiment that includes allof the features of FIG. 2B, and also transmits notices to the userregarding set-aside amounts, dates, and other information;

FIG. 2D is a flow diagram illustrating an embodiment that includes allof the features of FIG. 2C, and also provides instructions to a thirdparty escrow and payment service to initiate automated withdrawal ofset-aside funds from the user's bank account and payment therefrom ofthe required payments;

FIG. 2E is a flow diagram illustrating an embodiment that includes allof the features of FIG. 2D, except that the embodiment directly managesthe escrow and payment functions by sending appropriate instructionsdirectly to a bank or payment service; and

FIG. 3 is a flow diagram illustrating an embodiment that intercepts theincome of a payer, sets aside funds in anticipation of paying aplurality of financial obligations, and provides the remaining funds tothe payer for discretionary spending and for saving.

DETAILED DESCRIPTION

Unless specifically stated otherwise, as apparent from the discussionsherein, it is appreciated that throughout the specification discussionsutilizing data processing or manipulation terms such as “processing”,“computing”, “calculating”, “determining”, or the like, typically referto the action and/or processes of a computer or computing system, orsimilar electronic computing device, that manipulate and/or transformdata represented as physical, such as electronic, quantities within thecomputing system's registers and/or memories into other data similarlyrepresented as physical quantities within the computing system'smemories, registers or other such information storage, transmission ordisplay devices.

Practitioners of ordinary skill will recognize that a financial accountin a computer system is a set of data stored in the system that arerelated to the user or account owner/payer, or the taxing authority orother creditor, including data representing the amount of money held inthe source account or in an escrow account for the benefit of satisfyingthe obligation owed to the taxing authority or other creditor. Storageof the data is typically by means of well known mass storage devices,including disk drives, optical drives or other data storagetechnologies.

Various embodiments of the invention may incorporate a local and aremote system. There may be a local computer or computing device,handheld or otherwise, with a memory, processor, monitor or outputdevice, and mass storage device. The local computer may include anoperating system and supporting software such as but not limited to aweb browser or other suitable local interpreter or software, and mayoperate a local client process or software, such as but not limited toJavaScript or other suitable code operated by the supporting software,to produce an interactive display such as a web page for providing acustomer with a graphical user interface for data and instruction entryand receipt of reports.

The local computer may accept user input, maintain customer accountsincluding automatically tracking and/or recording estimated tax paymentrequirements for the user, establish security measures, for example,verifying user identity, and automatically deducting from one or moreuser accounts amounts necessary to meet a financial obligation, such asbut not limited to a tax authority payment requirement. An automatedpayment server may be used for tracking estimated tax payments of one ormore users and a bank server, selected by the user, may be a source fromwhich monies may be periodically deducted and set-aside for taxpayments. An automated payment server may store in a database, forexample, estimated tax payment requirements for the customer, securityinformation and account information, which may be transmitted to thebank server for executing payment operations. In various embodiments,the automated payment server and bank server may be operated by the sameor different controlling entities, for example, an automated paymentservice or bank service, respectively.

In some embodiments, an automated payment server may record a history ofpayments for each user as an account balance, for example, associatedwith each user's accounts. The bank server may include a database, forexample, for recording customer account details and histories. In someembodiments, users may have access to the transaction history of theiraccounts, for example, using a bank website interface. In someembodiments, the user may have control of and may adjust the amount orschedule of the automatic or periodic payments or may block or overwritesuch payments.

In some embodiments, an automated payment server may transmit a signalor message to the bank server, for example, to periodically impound ortransfer an amount of money from a source account held by the user.Messages may include data packets and may be transmitted and/or receivedbetween the user's local computer, automated payment servers, banksservers, credit card machines, ATMs, and/or other payment devices.According to embodiments of the present invention, the bank server mayperiodically impound or set aside into another account such as an escrowaccount, an amount of money from the user's source account, where eachamount set aside is less than the estimated tax or next paymentobligation, and the combined value of the amounts set aside by the duedate of the next estimated payment obligation substantially match theestimated payment due.

The bank server may automatically set-aside monies from the user sourceaccount, periodically, for example, hourly, daily, weekly, monthly,quarterly or annually. In an exemplary embodiment, monies may beautomatically set aside at a frequency, for example, on a weekly basis,to minimize the amount of monies set-aside at one time. Once sufficientset-aside funds are accumulated, for example, in a third-party accountsuch as an escrow account, and a payment is due to the taxing authorityor other creditor, the payment may be made from the third party account.In another embodiment, monies may be automatically set-aside whensufficient monies have accumulated in the user's monetary sourceaccount, for example, when a monthly or a random earning of some sort isreceived. In yet another embodiment, monies may only be set-aside uponapproval from the user. The set-aside monies may be submitted to theappropriate taxing authority or other creditor automatically by a thirdparty on behalf of the user on the due date for the next paymentrequired.

In some embodiments, the automated payment server may manage thepayments directed to a principle obligation while taking into accountother required payments for obligations such as monthly bills,mortgages, or other business or personal expenses. Based on financialinformation, for example, provided by a user, a fixed, variable, orestimated amount of monies may be reserved or set-aside for variousknown or predicted expenses other than the principle obligation. Forexample, in some embodiments monies are automatically set-aside from auser's source account when the monies in the account, excluding moniesallocated to or set-aside for other payments or expenses, are determinedto be sufficient. Principle and other prospective obligations of a usermay be prioritized in time and amount by user-imposed upper and lowerset-aside limits and periods, and order of fulfillment.

In some embodiments, the system may be programmed to set-aside moniesfrom various source accounts of a single user. For example, a monetarysource may include a bank account, a stock portfolio, a trust fund, etc.For example, if monies are to be set-aside from stocks, the execution ofthe set-aside instruction may include automatically selling a certainunit value of stocks. Alternatively, the execution of the set-asideinstruction might include automatically borrowing money from the bankhosting the account, with the stock portfolio as collateral. The userand/or system may be further configured or combined with other programsto use preferential planning to select the optimal stocks to sell inorder to acquire the necessary monies for the set-aside and/or paymentrequirement.

In another embodiment, the execution of set-aside instructions may notinclude transferring money, but placing restrictions, warnings orlimitations on the customer's use of or access to all or a portion ofmoney in the source account. For example, if a customer attempts towithdraw a portion of money allocated for a planned tax payment from thesource account, the transaction may be blocked or a warning sign mayappear on a payment interface such as an automated teller machine (ATM)or a graphical user interface of a bank or transaction service website.In some embodiments, the user may have control of and may block oroverwrite such restrictions.

By the date a required payment is due, sufficient funds for the paymentshould have been accumulated by the periodic set-aside mechanism. By thepayment due date, an automated payment server may recalculate therequired payment and deduct it from the customer's escrow or set-asideaccount and may transmit payment instructions via the Internet orotherwise to the bank server. Payment instructions, based on thecalculated payment requirement, may include authorization for processinga payment or transfer of funds, the amount to be paid and the source anddestination for the transfer of funds. The bank server may execute apayment, according to the payment instructions.

In some embodiments, payments to the taxing authority or other creditormay include submitting a taxpayer or user's personal and/or financialinformation, including for example social security number associatedwith the user, the amount to be paid, and appropriate instructions andsecurity data.

An automated payment server may include security and utility code togenerate security or verification information; such verificationinformation may be used to allow the appropriate user to monitor and/orcontrol their accounts for payment of taxes or other selectedobligations. Such verification information may also be used for meteringor billing users for services enabled by the invention.

Computer program logic implementing all or part of the functionalitypreviously described herein may be embodied in various forms, including,but in no way limited to, a source code form, a computer executableform, and various intermediate forms (e.g., forms generated by anassembler, compiler, linker, or locator.) Source code may include aseries of computer program instructions implemented in any of variousprogramming languages (e.g., an object code, an assembly language, or ahigh-level language such as FORTRAN, C, C++, JAVA, or HTML) for use withvarious operating systems or operating environments. The source code maydefine and use various data structures and communication messages. Thesource code may be in a computer executable form (e.g., via aninterpreter), or the source code may be converted (e.g., via atranslator, assembler, or compiler) into a computer executable form.

The computer program may be fixed in any form (e.g., source code form,computer executable form, or an intermediate form) either permanently ortransitorily in a tangible storage medium, such as a semiconductormemory device (e.g., a RAM, ROM, PROM, EEPROM, or Flash-ProgrammableRAM), a magnetic memory device (e.g., a diskette or fixed disk), anoptical memory device (e.g., a CD-ROM), a PC card (e.g., PCMCIA card),or other memory device. The computer program may be fixed in any form ina signal that is transmittable to a computer using any of variouscommunication technologies, including, but in no way limited to, analogtechnologies, digital technologies, optical technologies, wirelesstechnologies, networking technologies, and internetworking technologies.The computer program may be distributed in any form as a removablestorage medium with accompanying printed or electronic documentation(e.g., shrink wrapped software or a magnetic tape), preloaded with acomputer system (e.g., on system ROM or fixed disk), or distributed froma server or electronic bulletin board over the communication system(e.g., the Internet or World Wide Web.)

With reference to FIG. 1A, the present invention is an apparatus andmethod for transforming a non-compliant payer of estimated taxes, or ofanother financial obligation, into a compliant payer 24. The inventionfacilitates the accrual of revenue on a frequent, periodic basis,without undue burden to the payer, in preparation for making larger,less frequent payments of the estimated taxes or other obligations thatwould otherwise be difficult to afford, under circumstances where thepayment intervals, the amounts due, and/or the payer's ability to payis/are variable.

As illustrated in FIG. 1A and in the simple embodiment of FIG. 2A(discussed in more detail below), the initially non-compliant payer 10,200 begins by gaining access to the apparatus of the present invention202, either by using a calculating device that is locally available tothe payer, such as a personal computer or hand-held device, or byconnecting to the apparatus over a network such as the internet. In someembodiments where the method is provided as a service over the internet,if the payer has not previously used the invention, the payer begins byenrolling as a subscriber 12, which results in an email beingtransmitted to the payer 14 containing login information.

Having become a subscriber and logged into the software of theinvention, the payer is then prompted to enter his or her estimatedannual tax liability 100, and the date(s) when payment(s) is/are due.For some embodiments, rather than entering a tax liability, thesubscriber can enter data such as expected income, expected deductions,number of dependents, and previous year's tax liability, and theembodiment can calculate therefrom the expected tax liability andrequired estimated tax payments for the subscriber.

The subscriber can also enter preferences regarding how accrualset-aside amounts should vary over the course of a payment term. Forexample, the subscriber may be a teacher who earns more during thewinter than during the summer, or the subscriber may work inconstruction and earn more during the summer and less during the winter.The subscriber may also have expenses that vary during the year, such asheating costs that are higher during the winter. Unpredictable changesand/or events may also occur during the tax year, and may even cause thepayer to fall short in making the fund set-asides called for by theset-aside schedule. Embodiments of the present invention therefore allowa payer to adjust the set-aside amounts, both before the initialschedule calculation 16 and at any time during the payment term, so asto provide and maintain a schedule of variable set-asides that ispractical for the subscriber to implement and to follow, as compared toa more rigid and less practical schedule of fixed set-asides that do nottake into account the predictable and unpredictable variations inincome, expenses, and other factors that typically occur during a taxyear or other payment term.

In various embodiments, the payer can delay, change or cancel anyset-aside or group of set-asides at any time. The payer can also makeadditional set-asides not included in the schedule, or withdraw fundsthat have been previously set aside, for example to meet an unexpectedemergency or take advantage of an unanticipated opportunity. Theset-aside schedule can then be re-calculated so as to take these actionsinto account.

After the subscriber has entered the required data and preferences, theinvention then calculates 16 a schedule of set-aside amounts andset-aside periods, which the payer can review and modify as needed.During the payment term, some embodiments provide notifications 18 thatserve to remind the payer to review and adjust the set-aside schedule,to set aside funds and/or to make payments. In other embodiments, thenotifications simply inform the payer as to set-asides and payments thatwill be made automatically, and to further inform the payer when thepayments have been made 20. If the tax liability, the payer's ability topay, or any other factor varies during the course of the tax year orother payment term 22, the set-aside schedule can be reviewed andrecalculated accordingly 16. Whether or not the set-aside schedulerequires adjust during the payment term, by following the set-asideschedule the initially non-compliant payer is transformed by theinvention into a compliant payer.

FIG. 1B illustrates how in some embodiments calculation data isobtained, a set-aside schedule is calculated, adjustments are made, andthe set-aside schedule is re-calculated as needed. A first set-asidedate is determined 26, which could be the date of enrollment of thepayer 28 in a service providing access to the invention, a beginningdate of a payment term for the obligation, or any other date selected bythe payer (for example, the first Wednesday following enrollment, or thefirst day of the next month following enrollment). The due date forpayment of the obligation 30 is either directly entered by the payer ordetermined from another source 32, such as from the IRS, or a websitemaintained by another creditor. The payment amount is either entereddirectly by the payer, obtained from the IRS or from another creditor,or calculated using information pertaining to the payer 36. For example,in some embodiments the payer provides estimates of his or her income,deductions, and number of dependents, and the embodiment calculates anestimated tax obligation therefrom. Additional preferences 38 are alsosupplied by the payer 40, such as how frequently the payer wishes to setfunds aside (e.g. weekly, by-weekly, monthly, etc), and how the payerwishes to vary the relative amounts of the set-asides. For example, thepayer may wish to set aside equal amounts for all set-aside periods, thepayer may wish to set aside larger amounts during periods when the payerexpects to have a higher income (for example a construction worker mayearn more during the Summer), or the payer may wish to set aside lessduring periods of high expense, such as during the winter when heatingbills are high.

Collectively, the first set-aside date, the due date, the paymentamount, and the other preferences represent calculation data 42 that canbe used, possibly together with other data, to calculate a set-asideschedule 44. The set-aside schedule is provided to the payer 46, and thepayer is allowed to make adjustments 48, either at the outset of theset-aside process or at any desired time after set-asides begin. Forexample, the payer's income may vary in unexpected ways, unexpectedexpenses may arise, the payment amount may change, and/or the payer mayfind it necessary to miss a set-aside. By making adjustments 48 to thecalculation data 42 and re-calculating 44 the set-aside schedule, theembodiment is able to adapt to changing conditions, and to update theset-aside schedule so that it remains relevant and practical for thepayer to follow.

FIGS. 1C through 1G are illustrations of algorithms that are used invarious embodiments to calculate set-aside schedules. With reference toFIG. 1C, in the case of estimated taxes being paid in the US, andassuming for the sake of simplicity that the tax year has not yet begun,the calculation begins by dividing the total tax obligation 100 by thenumber of payment intervals in the year 102, which is 4, according tothe requirement to pay estimated taxes in the U.S. on a quarterly basis.In other countries, the invention can accommodate other paymentschedules including, tri-annual, semi-annual, or other tax submissionintervals.

This provides the amount due 104 in each estimated tax “quarter.” Ofcourse, the actual estimated tax payment intervals are not equal 3-monthquarters, but are intervals that can vary from 8-9 weeks in the secondquarter to 17-18 weeks in the fourth quarter. In the embodiment of FIG.1B, the software divides the amount due in each quarter 104 by theminimum number of weeks that can occur in that quarter 106-112, therebyderiving weekly set-aside amounts for each quarter 114-120. The setaside amounts will vary from quarter to quarter. For example, theamounts for the second quarter 116 and the fourth quarter 120 willdiffer by approximately a factor of two. However, the embodiment of FIG.1B will ensure that adequate funds are set aside in time for eachestimated tax payment, while allowing only modest set-aside amounts tobe carried over from one quarter to the next. In some embodiments, thelast set-aside amount of each quarter will be reduced or eliminated asneeded so as to avoid carry-over to the next quarter.

The calculation illustrated in FIG. 1C can be expressed as:S _(n)=(T/I)/P _(i)  (1)where S_(n) is the set-aside amount for payment period n, T is the totaltax liability for the year, I is the number of payment intervals(Quarters) in the year (I=4 in the example of FIG. 1A), and P_(i) is the(integer) number of complete set-aside periods in the payment interval iin which the n′th set-aside period occurs.

A slightly more sophisticated embodiment is shown in FIG. 1D. Thisembodiment recognizes that estimated tax quarters can include partialweeks, and so divides 122-128 the quarterly payment amounts 104 bynumbers that include partial weeks. For example, if the second quarteractually includes 8 weeks and 5 days, the second quarter amount will bedivided by 8 5/7, or 8.7143, where 0.7143 is the decimal equivalent ofthe additional 5 days, expressed as a fraction of a week.

The calculation illustrated in FIG. 1D can be expressed as:S _(n)=(T/I)(L/D _(i))  (2)where L is the length (in days) of the set-aside period (L=7 in FIG.1D), and D_(i) is the number of days in payment interval i.

This approach, as compared to the embodiment of FIG. 1D, helps tominimize the carry-over of set-aside funds from one quarter to the next,and/or minimize the need for a reduced set-aside at the end of eachquarter. The additional day in the first quarter of a leap year can besimilarly accommodated. So as to avoid the possibility of insufficientset-aside, some embodiments adjust the date of the first set-aside, forexample requiring the first set-aside to be paid upon commencement ofthe quarter, and/or require an initial payment of at least a partialset-aside.

Various other embodiments take partial set-aside periods into account bydividing the amount due in a quarter by the number of days in thequarter, and then multiplying by the number of days in a set-asideperiod (7 for one week, or 14 for two weeks, for example).

While the embodiments of FIG. 1C and FIG. 1D calculate an amount to beset aside each week, they do not specify precisely when each amountshould be set aside. In the embodiment of FIG. 1E, a specific day of theweek (Wednesday in this example) is designated as the set-aside day, andthe amount due for each quarter 104 is divided by the number ofWednesdays in the quarter 130-136, as determined using for example alookup table or day-of-the-week algorithm 138. It is assumed that theactual set-aside will occur on the same day that the instructions aretransmitted to the bank.

The embodiment of FIG. 1E can support batch processing of periodic(weekly) transfers or debits to for a plurality of users, knowing thatdebiting from the user's account will usually take place the same day,or the next business day. In this example the transfer or debit batchinstructions would be submitted on Wednesday, in time to be in theinterest-bearing account and maximize interest earned over the weekend,if an escrow account (see prior art section on impounding), is used tohold the periodic tax set-asides until it is time to make a payment atthe end of the tax submission interval. Having this occur on a same dayor next day basis due to bank transfer processing time, or aninterruption in the transaction due to a bank holiday, or force majeure,etc. still allows for a Friday receipt of funds. This embodiment alsoallows the user to keep and to use the funds in his or her account as afloat, from the previous week until Tuesday at the earliest, and notlose the weekend interest on each periodic amount.

The embodiment of FIG. 1F recognizes that the periodic set-asides maynot begin at the beginning of a tax year, and/or that there may beoverpayments or underpayments resulting from a portion of the tax yearthat has already elapsed and/or from a preceding year that must beaccounted for. In this embodiment, the user has the option to make upfor any underpayments in a lump sum before calculating set-asideamounts. Or, optionally, additional amounts can be added 140-144 to anyor to all remaining quarters according to any desired allocation so asto make up the deficit. Similarly, any overpayments can be apportioned140-144 to any combination of remaining quarters according to userpreference. For example, one option is to begin set-asides only afterall overpayments and/or credits have been used. Another option is toapply any deficiencies or overpayments evenly across some or all of theremaining set-aside intervals of the tax year.

As a more complex example, assume that there is an overpayment O fromthe previous year, that periodic set-asides have begun only after Kset-aside intervals have already elapsed, that the payer wishes to applythe overpayment to compensate for the payments missed during the elapsedperiods, and to distribute the difference equally over the remainingset-aside periods, and that the payer has specified certain otherspecific set-aside adjustments A_(n) applicable to at least some of theset-asides. Under these assumptions, the calculation illustrated in FIG.1E can be expressed as:

$\begin{matrix}{S_{n} = {{\left( {T/I} \right)\left( {L/D_{n}} \right)} - {\left( {O - {\sum\limits_{j = 1}^{K}\; S_{j}}} \right)/\left( {N - K} \right)} + A_{n}}} & (3)\end{matrix}$where N is the total number of set-aside periods during the entire taxyear, given by

$\begin{matrix}{N = {\sum\limits_{i = 1}^{I}\; P_{i}}} & (4)\end{matrix}$

FIG. 1G presents an embodiment in which the set-aside amount remainsfixed during a tax year, while the set-aside period is adjusted so as tocompensate for the different lengths of the tax quarters. After thequarterly estimated tax amount has been calculated 104, it is divided bythe smallest number of set-aside periods (i.e. weeks) for any of thequarters, which is eight. This amount becomes the set-aside for eachperiod of each quarter. Because the quarters differ in length, it isthen necessary to divide the length of each quarter (in days) by eight150-156 so as to determine how frequently to enact the set-asides158-164.

The calculation illustrated in FIG. 1G can be expressed as:S _(n)=(T/I)/MIN(P _(i))  (5)L _(n) =D _(n)/MIN(P _(i))  (6)where L_(n) is the length (in days) of the set-aside period for paymentinterval n, and MIN(P_(i)) is the smallest number of “minimum” set-asideperiods in any of the payment intervals i. For example, if the payer hasspecified that he or she wishes to set aside funds no more often thanevery week, MIN(P_(i)) is the minimum number of weeks in any of thepayment intervals P_(i), which is 8 (from the second quarter).

For example, if a total tax liability of $4000 will be due for the taxyear, 8 set-asides/payments of $125 are pre-calculated 148 and scheduledto meet each interval's estimated tax liability of $1,000. The softwarethen divides the number of days in the 1^(st) quarter by the same numberof periodic set-asides 150, which is eight. In this example, 90 daysdivided by eight yields a set-aside period of 11.25 days, or 11.375 daysin a 91-day leap year Q1. Rounding the decimals down to the nearestwhole number means that the aforementioned uniform $125 periodicset-asides will occur 158 every 11 days in the first quarter. Paying thesame periodic set-aside amount eight times during the third quarter 154also leads to set-asides occurring 162 every 11 days, while in thefourth quarter 156, which is the longest, set-asides are made 164 onlyevery 15 days, or twice a month on average.

Various embodiments include a rounding feature, which enables allset-asides to be in whole dollars and an adjustment to take place in thelast period (e.g. week) of the payment interval (e.g. quarter). Anexample is depicted in Table 2: below, in which weekly set-asides for Q1are $209.00, and the final set-aside for Q1 is $201.00, weeklyset-asides for Q2 are $278.00, and the final set-aside for Q2 is$273.00, weekly set-asides for Q3 are $193.00, and the final set-asidefor Q3 is $184.00, and weekly set-asides for Q4 are $139.00, and thefinal set-aside for Q4 is $137.00.

TABLE 2 IRS Set-aside Set-aside Applied to Quarterly Set-aside BalanceEFTPS # Date Quarter Set-aside # Amount in Escrow Debits BeginningBalance $0 1 Jan. 7, 2009 1 1 $209 $209 2 Jan. 14, 2009 1 2 $209 $418 3Jan. 21, 2009 1 3 $209 $627 4 Jan. 28, 2009 1 4 $209 $836 5 Feb. 4, 20091 5 $209 $1,045 6 Feb. 11, 2009 1 6 $209 $1,254 7 Feb. 18, 2009 1 7 $209$1,463 8 Feb. 25, 2009 1 8 $209 $1,672 9 Mar. 4, 2009 1 9 $209 $1,881 10Mar. 11, 2009 1 10 $209 $2,090 11 Mar. 18, 2009 1 11 $209 $2,299 12 Mar.25, 2009 1 12 $201 $2,500 Quarter 1 IRS Debit $2,500 13 Apr. 1, 2009 2 1$278 $278 14 Apr. 8, 2009 2 2 $278 $556 15 Apr. 15, 2009 2 3 $278 $83416 Apr. 22, 2009 2 4 $278 $1,112 17 Apr. 29, 2009 2 5 $278 $1,390 18 May6, 2009 2 6 $278 $1,668 19 May 13, 2009 2 7 $278 $1,946 20 May 20, 20092 8 $278 $2,224 21 May 27, 2009 2 9 $276 $2,500 Quarter 2 IRS Debit$2,500 22 Jun. 3, 2009 3 1 $193 $193 23 Jun. 10, 2009 3 2 $193 $386 24Jun. 17, 2009 3 3 $193 $579 25 Jun. 24, 2009 3 4 $193 $772 26 Jul. 1,2009 3 5 $193 $965 27 Jul. 8, 2009 3 6 $193 $1,158 28 Jul. 15, 2009 3 7$193 $1,351 29 Jul. 22, 2009 3 8 $193 $1,544 30 Jul. 29, 2009 3 9 $193$1,737 31 Aug. 5, 2009 3 10 $193 $1,930 32 Aug. 12, 2009 3 11 $193$2,123 33 Aug. 19, 2009 3 12 $193 $2,316 34 Aug. 26, 2009 3 13 $184$2,500 Quarter 3 IRS Debit $2,500 35 Sep. 2, 2009 4 1 $139 $139 36 Sep.9, 2009 4 2 $139 $278 37 Sep. 16, 2009 4 3 $139 $417 38 Sep. 23, 2009 44 $139 $556 39 Sep. 30, 2009 4 5 $139 $695 40 Oct. 7, 2009 4 6 $139 $83441 Oct. 14, 2009 4 7 $139 $973 42 Oct. 21, 2009 4 8 $139 $1,112 43 Oct.28, 2009 4 9 $139 $1,251 44 Nov. 4, 2009 4 10 $139 $1,390 45 Nov. 11,2009 4 11 $139 $1,529 46 Nov. 18, 2009 4 12 $139 $1,668 47 Nov. 25, 20094 13 $139 $1,807 48 Dec. 2, 2009 4 14 $139 $1,946 49 Dec. 9, 2009 4 15$139 $2,085 50 Dec. 16, 2009 4 16 $139 $2,224 51 Dec. 23, 2009 4 17 $139$2,363 52 Dec. 30, 2009 4 18 $137 $2,500 Quarter 4 - IRS Debit $2,500Totals $10,000 $10,000

Table 2 presents an example of calculated set-aside amounts and periodsfor a total tax year liability of $10,000 according to the embodiment ofFIG. 1C, including the rounding feature described above. Equal quarterlypayments of $2500 are made. During each quarter, equal amounts are setaside every seven days, except for the last period where slightly lessis set aside so as to offset the effect of rounding to whole dollars.Due to the unequal lengths of the quarters, the set-aside amount variessubstantially between quarters, from a maximum of $278 in the secondquarter to a minimum of $139 in the fourth quarter.

Various embodiments allow a user to make adjustments to the calculatedset-aside amounts and/or periods, for example so as to anticipateforeseeable events. An example from an embodiment is presented in Table3 below, where a user has decided to increase the 1st and 2nd quartersby 500 dollars each, and decrease the 3rd quarter, based on the factthat the user is a teacher and his/her income is lower during the summermonths.

TABLE 3 Weekly Total Enter Amounts to Adjust Set- Set- Amount asides inthe Quarters Below: Asides of Quarterly To Factor in Catch-up WeeklySet-Aside in Each Funds to One-Time-Payments Amounts and Timing QuarterEscrow select “Decrease by” $209.00 = Q1 (Jan. 12 $2,500.00 Increaseset-asides by 1st-Mar. 31st) $500 in the 1^(st) Quarter Preliminary Set-Aside Amounts $278.00 = Q2 (Apr. 9 $2,500.00 Increase set-asides by1st-May. 31st) $ 500 in the 2nd Quarter Preliminary Set- Aside Amounts$193.00 = Q3 (Jun. 13 $2,500.00 Decrease set-asides by 1st-Aug. 31st)$1000 in the 3rd Quarter Preliminary Set- Aside Amounts $139.00 = Q4 18$2,500.00 Decrease set-asides by (Sep. 1st-Dec. 31st) $0 in the 4thQuarter Preliminary Set- Aside Amounts $ 0 Total Adjustments

The result of entering these adjustments is shown in Table 4 below.

TABLE 4 IRS Set-aside Set-aside Applied to Quarterly Set-aside BalanceEFTPS # Date Quarter Set-aside # Amount in Escrow Debits BeginningBalance $0 1 Jan. 7, 2009 1 1 $250 $250 2 Jan. 14, 2009 1 2 $250 $500 3Jan. 21, 2009 1 3 $250 $750 4 Jan. 28, 2009 1 4 $250 $1,000 5 Feb. 4,2009 1 5 $250 $1,250 6 Feb. 11, 2009 1 6 $250 $1,500 7 Feb. 18, 2009 1 7$250 $1,750 8 Feb. 25, 2009 1 8 $250 $2,000 9 Mar. 4, 2009 1 9 $250$2,250 10 Mar. 11, 2009 1 10 $250 $2,500 11 Mar. 18, 2009 1 11 $250$2,750 12 Mar. 25, 2009 1 12 $250 $3,000 Quarter 1 IRS Debit $3,000 13Apr. 1, 2009 2 1 $334 $334 14 Apr. 8, 2009 2 2 $334 $668 15 Apr. 15,2009 2 3 $334 $1,002 16 Apr. 22, 2009 2 4 $334 $1,336 17 Apr. 29, 2009 25 $334 $1,670 18 May 6, 2009 2 6 $334 $2,004 19 May 13, 2009 2 7 $334$2,338 20 May 20, 2009 2 8 $334 $2,672 21 May 27, 2009 2 9 $328 $3,000Quarter 2 IRS Debit $3,000 22 Jun. 3, 2009 3 1 $116 $116 23 Jun. 10,2009 3 2 $116 $232 24 Jun. 17, 2009 3 3 $116 $348 25 Jun. 24, 2009 3 4$116 $464 26 Jul. 1, 2009 3 5 $116 $580 27 Jul. 8, 2009 3 6 $116 $696 28Jul. 15, 2009 3 7 $116 $812 29 Jul. 22, 2009 3 8 $116 $928 30 Jul. 29,2009 3 9 $116 $1,044 31 Aug. 5, 2009 3 10 $116 $1,160 32 Aug. 12, 2009 311 $116 $1,276 33 Aug. 19, 2009 3 12 $116 $1,392 34 Aug. 26, 2009 3 13$108 $1,500 Quarter 3 IRS Debit $1,500 35 Sep. 2, 2009 4 1 $139 $139 36Sep. 9, 2009 4 2 $139 $278 37 Sep. 16, 2009 4 3 $139 $417 38 Sep. 23,2009 4 4 $139 $556 39 Sep. 30, 2009 4 5 $139 $695 40 Oct. 7, 2009 4 6$139 $834 41 Oct. 14, 2009 4 7 $139 $973 42 Oct. 21, 2009 4 8 $139$1,112 43 Oct. 28, 2009 4 9 $139 $1,251 44 Nov. 4, 2009 4 10 $139 $1,39045 Nov. 11, 2009 4 11 $139 $1,529 46 Nov. 18, 2009 4 12 $139 $1,668 47Nov. 25, 2009 4 13 $139 $1,807 48 Dec. 2, 2009 4 14 $139 $1,946 49 Dec.9, 2009 4 15 $139 $2,085 50 Dec. 16, 2009 4 16 $139 $2,224 51 Dec. 23,2009 4 17 $139 $2,363 52 Dec. 30, 2009 4 18 $137 $2,500 Quarter 4 - IRSDebit $2,500 Totals $10,000 $10,000

A comparison of Table 4 with Table 2 shows that the original summerset-aside (Q3) amount of 193 dollars was reduced to 116 dollars perweek. This automated adjustment, recalculating, and reschedulingfunctionality has enabled the user to reduce his or her summer monthsset-asides by 77 dollars per week, or 40%, thus making the set-asideschedule more practical for the user to adhere to by transforming astill burdensome set-aside schedule into a more tolerable one.

The same automated recalculating and scheduling functionality can beused when unforeseen circumstances arise, be they windfalls or shortagesin income that would affect estimated tax amounts, up and down.

In various embodiments users are able to make numerous adjustments tothe set-aside calculation, including but not limited to resetting oroverriding the start date for periodic payments, specifying subsequentpayments and end dates, if the automatically proposed schedule ofperiodic payments is not optimal, overriding any specific set-asidepayment amount(s) on any date, and substituting a more desirable or morepractical schedule. In some embodiments a percentage of income orpercentage of deposit formula can be selected.

In certain embodiments, individual set-asides are brought to theattention of the user via reminders that are automatically and/ormanually transmitted by email, fax, mail, repetitive calendar settings,or by any other suitable means. In some internet-accessed embodimentshyperlinks are provided in each email notice of an upcoming set-aside,so as to provide easy login and navigation directly to a next set-asideadjustment screen, where the set-aside can be adjusted in amount, held,or cancelled, after which the set-aside schedule can be eitherre-calculated or left as it is.

One frequent change for U.S. taxpayers performing their originalcalculations before, or during the early part of the year arises becausethe original annual tax liability calculation is based on two year oldinformation. Then, during the first quarter, and sometimes in subsequentquarters, the tax return for the year immediately preceding the currentyear must be taken into account. As an example, if a user manuallycalculated, or used the present invention described herein to calculateannual tax liability on Jan. 1, 2009, the input numbers would typicallybe based on earnings, deductions, and credits for the 2007 tax year,since the vast majority of taxpayers do not know the previous year'snumbers (for 2008) until a tax return is prepared later in the currentyear 2009. Taxing authorities mandate that when a material upward changeoccurs in the newly filed return for a year immediately preceding thecurrent year (in this example 2008), an adjustment increasing the amountof the required payments must be made to avoid penalties. In the eventthat a downwards change in income has occurred, it is the option of theuser to recalculate and reduce periodic tax payments. Because this typeof information is usually calculated on or before Apr. 15, of 2009, butwith extensions, may not be calculated until Oct. 15, 2009, embodimentsof the present invention have the built-in functionality and formulae torecalculate changes in tax liability and periodic set-aside amounts atany time. Resulting shortfalls or surpluses in set-asides can berectified by a single lump payment or refund, by spreading thedifference over the remaining set-asides for the tax year, or by anymethod preferred by the user, including all calculations facilitated bylook up tables, algorithms, and/or any arbitrary amount(s) of subsequentset-aside amounts entered by the user for any reason.

Certain embodiments enable users to obtain access to the presentinvention by enrolling in a user group, which in some embodimentsincludes a group administrator. Said user group, a partnership forexample, in addition to enjoying the freedom of having the informationand controls of the invention available to all partners and associates,could also receive some form of compensation, based on revenue receivedfrom paying users enrolled in the user group. In some of these usergroups, the administrator has full access to information entered,set-aside schedules calculated, transactions enacted, and all other datapertaining to the user group. In other embodiments, the administrator islimited to facilitating and tracking user enrollment, and toestablishing and maintaining the availability of the apparatus andmethod of the invention.

Embodiments of the present invention are able to interface withfinancial, accounting, and tax software applications, so that enrollmentinformation, tax amounts, schedules, adjustments, reports, etc. can beexternally reported through said third party software, and informationthey contain can be auto-loaded into the apparatus of the currentinvention.

Some embodiments of the present invention provide different features todifferent users according to usage levels assigned to the users. Forexample, some embodiments charge fees for use of the invention, andprovide a fee structure that depends on the level of service desired bya user. Other embodiments offer the same features to all users, wherethose features correspond to one of the user “levels.” Some of theseembodiments are primarily of interest to individual payers, while otherscan be of significant utility and benefit to tax accountants, banks, andother organizations and creditors.

FIG. 2A illustrates an embodiment of the invention that provides basicfeatures to a “level 1” user 200, who accesses the invention either bydirect possession and use of an apparatus 202 on which the software ofthe invention operates, or by interaction with the apparatus 202 over anetwork such as the internet. The user 200 supplies requiredinformation, such as the total amount of the tax or other obligation,when payments are due (including any applicable grace periods), whatset-aside period is preferred, the desired manner in which to distributeany overpayment(s) and/or credit(s), and any other information relatingto the amount and scheduling of periodic set-asides. The apparatus 202then calculates a set-aside schedule and provides recommended amountsand periods for the set-asides.

It can be seen from FIG. 2A that information is exchanged only betweenthe user 200 and the apparatus 202. Note that if the Level 1 user 200wishes instead to input specific amounts to be set-aside, meaning theuser 200 can afford or desires to pay said fixed amount, the apparatus202 will recommend a frequency and/or timing whereby the fixed amount,periodic set-asides should be made. Note also that the user 200 can usea percentage of income, or of deposits, as a basis upon which theapparatus 202 will determine a recommended set-aside schedule. Theembodiment of FIG. 2A can be calendar-based or not, and can beaccessible either online or offline, using software that is executableon a general purpose computer or on a standalone apparatus.

FIG. 2B illustrates an embodiment that provides features of the presentinvention to a “level 2” user 204. The user communicates with theapparatus 202 over the internet 206, and the apparatus 202 storesuser-supplied information and the results of calculations in a database208 or other storage device for future retrieval and use. This featureprovides to the user of the invention the ability to recalculateperiodic set-aside amounts and/or payments in a more automated fashion,since the user need enter only the changes that are envisioned, areoccurring, or have already occurred. To use this feature, the user isonly required to provide identifying information, such as a name, ausername, a password, and perhaps a secret question/answer as a furtheridentifier, etc. In particular, the user is not required to provideconfidential information such as an address, date of birth, taxpayer ID#, etc.

FIG. 2C illustrates an embodiment that provides features of the presentinvention to a “level 3” user 210. At this level, the user 210communicates with the apparatus of the invention 202 over the internet206, and also receives notifications from the apparatus. Users canrequest periodic notifications of set-asides, payments made, number ofset-asides remaining in the current interval, and other pertinentinformation. The notifications can be delivered to the user by anyconvenient means, such as by online report, by email, by text message,by automated telephone message, by messages auto-inserted in computercontrolled calendar schedules, and/or by mail, and can be received usingany appropriate means and/or device. Notifications can also includeother events that affect the user, including but are not limited tocalendar events, user payments or lack of payment events, bank events,and accessibility of the calculation apparatus, in embodiments where theapparatus is accessed over a network such as the internet. The contentand timing of these notifications and communications can be individuallyprocessed, or as a part of a batch file 212 processed by internal orexternal logic.

In the embodiment of FIG. 2C, the user 210 may choose to make periodicset-aside, or catch up payments from his or her bank account 214 viacheck, which can be sent directly to the payee, such as the U.S. federaltaxing authority (“IRS”) 216. In many territories, taxing authorities,or other payees, have electronic payment options for registered uses oftheir electronic payment systems 218, such as wire transfers, or debits,which in this embodiment, are initiated by the user, presumably based onperiodic set-aside information provided by the invention, and processedby the EFPTS 220 or by a similar system.

For users who have irregular or sporadic income, and who wish to makepayments or set-asides according to a percentage of their income, ordeposits, the embodiment of FIG. 2C can send a query to the user 210 vianotification 206, asking if now is a good time to set aside thepercentage amount, based on the embodiment's knowledge of the calendar,payment requirements for this specific user 210 and his or her history.

Embodiments of the present invention can be interfaced with other thirdparty systems, which can automatically, electronically transfer orotherwise debit the periodic set-aside amounts, as determined by theapparatus of the invention.

FIG. 2D illustrates an embodiment that provides features of the presentinvention to a “level 4” user 222. In this embodiment, the user's bankaccount 214 is interfaced with a third party banking and/or paymentsystem 224, such as the system described in U.S. Patent Application#20080097878, a banking and/or payroll system, an automatic paymenttransfer and/or debiting system deployed by a taxing authority (the IRSEFTPS system as an example), the payee itself (acting directly as thereceiving party), or by any other payment transfer and/or debitingsystem operated by a third party, such as Western Union, PayPal, etc.The third party payment system 224 is thereby able to act on informationprovided by the apparatus of the invention 202, or otherwise utilize itscalculating, scheduling, notifying and facilitating functionalities, todebit periodic set-aside amounts from the Level 4 user's bank account214 via ACH or other types of money transfers 226, into an accountwithin his or her control, or within his or her bank's control forsafekeeping, in a manner similar to the way in which third partiesmaintain funds for current banking services, payroll services and/orother functions. The third party payment system 224 then makes therequired payments via ACH debit or similar transfer methods 228 to EFTSor another collection system 220, which forwards the payments to the IRSor other payee 216.

In some embodiments the present invention is configured with, orembedded within a third party service 224, such as a creditor'saccounting system, tax software preparation and filing systems, bankinformation systems, payroll systems, online and offline paymentsystems, and such like, so as to provide additional new functionality,i.e. notifications and communications 230, and/or enhance the collectionand payment capabilities 232, as a separate module or service on thethird party's existing platform, or as functionality that is compiledinto, or otherwise combined with the third party system's source code,data integration/middleware, semantic taxonomies and ontologies, datastores, data marts, data warehouses, CRM systems, screen scrapingtechnologies, business process management servers and business rulesengines, etc.

This embodiment can be interfaced with other systems, and canautomatically notify the user before, during, and/or after every step ofcalculating, scheduling, notifying, and facilitating incoming andoutgoing payment processes, as well as notifying and recalculating Level4 users, when anticipated set-aside payments were not received.

FIG. 2E illustrates an embodiment that provides features of the presentinvention to a “level 5” user 234. This embodiment is similar to theembodiment of FIG. 2D, but does not require use of a third party paymentsystem, but instead includes the ability to directly send fund transferinstructions to a bank or payment service, such as CheckFree or PayPal,so as to deposit the set-aside funds into a holding account 236preferably, but not limited to an escrow account, which by nature hasthird party fiduciary responsibility. Said holding account 236 canfacilitate the accrual of interest on the periodic set-aside amountsdeposited therein, until the larger payment for the current interval ismade 228, usually via automated payment systems like the EFTPS 230, atwhich time the Level 5 user 234 can receive rebates in the amount of theaccrued interest on the set-aside payments, should an interest-bearingaccount, or side-wiping interest earning account, such as a money marketaccount, be utilized.

The escrow account 236 can be opened in the Level 5 user's own name, orit can be a part of a larger escrow account that aggregates set-asidesfrom multiple system users. This account may or may not accrue interestuntil such time as funds are disbursed 228, presumably at the timespecified by the taxing authority or other payee for the interval. Theembodiment can calculate the interest, and distribute it via a batchprocess to each Level 5 user in pro-rated amounts. For users withaccounts in their own names, interest is calculated by the bank or otherinstitution and reported to the user 234, either directly or through theapparatus of the embodiment.

If needed, the Level 5 user 234 can withdraw all or part of the funds inescrow, in case of emergency or at any time and for any reason, asindicated by the bi-directional arrow in FIG. 2E (via 224 between 214and 236). This feature is especially important for entrepreneurs andother self-employed individuals who may need to use the tax money forbusiness or other purposes, be they routine or extraordinary in nature.

All notifications 206 can be sent individually, or accomplished viabatch notification 238, and all transactions can be facilitated by theembodiment individually or via batch processing 240.

While the discussion above is directed toward compliance with a singlefinancial obligation, it will be clear to those of average skill in theart that the invention can be used to facilitate simultaneous compliancewith a plurality of financial obligations. In various of theseembodiments, separate set-aside schedules are calculated as describedabove for each of the obligations, and then the separate set-asideschedules are combined into a unified schedule, typically bysynchronizing the set-aside periods and simply adding together theset-aside amounts from the separate set-aside schedules. In some ofthese embodiments, the payer specifies a prioritizing preference thatindicate how set-aside funds should be allocated among the obligationsin case a shortfall occurs, for example if the payer is not able tofully adhere to the unified set-aside schedule due to unforeseencircumstances or for any other reason.

With reference to FIG. 3, in some embodiments of the present inventionincome received by the payer is initially placed in an income holdingaccount 300, from which set-aside amounts are periodically transferredto an escrow account 302 according to one or more set-aside schedules.The calculating of the set-aside schedules is facilitated by one or moreinstances of the functionality of the present invention in combinationwith a synchronizing logic layer, or a combined, RETE-based accrual andpayment engine, or both. Payments are then made from the escrow account302 toward the one or more financial obligations 304-314 according totheir amounts and due-dates. If insufficient funds are available to makeall scheduled payments, user-specified priorities, prudence, bestpractices, and creditor policies are applied to allocate available fundsamong the financial obligations 304-314.

Any funds remaining in the income holding account 300 that are notneeded for the set-aside account 302 are transferred to a discretionaryspending account and/or to a savings account 316. In some embodiments,the system can be queried by computer, and/or by voice recognitionsoftware, as to whether a certain planned expenditure can be afforded.The system then uses the RETE algorithm, ontologies with rationalagents, inference engines, and/or other tools to consider a number offactors and provide a response such as “yes,” “no,” or “somewhat.” The“somewhat” response, for example, can indicate that credit scores willlikely be negatively impacted if more than a certain amount is expendedfrom the discretionary spending account at that time, because maximumflexibility requires a certain balance to be maintained in thediscretionary spending account.

Any interest received due to funds held in the income holding account300, the escrow account 302, and/or the discretionary spending andsavings accounts 316 accrues for the benefit of the payer. While thepayer normally does not deposit or withdraw funds directly to or fromthe income holding account 300 or the escrow account 302, the payer cando so at any time and for any reason, typically to meet the requirementsof an emergency or to take advantage of an unanticipated opportunity.

Various embodiments of the present invention enable creditors to jointogether and/or to individually participate in the commercialization ofbank accounts or other accounts as depicted in FIG. 3, by acceptingminimum and expected payments, like credit card companies, instead ofonly fixed equal payments. They can also use the present invention as aflexible collection system that has the intelligence to make and monitormost work-out arrangements, thereby reducing labor in work-outdepartments.

It will be readily apparent that there are numerous and varied otherembodiments and examples of the invention. For example, there is acomputer-enabled method for improving compliance of a payer subject to afinancial obligation by use of periodic set-asides of funds sufficientto make required payments in accordance with terms of the obligation,comprising using a computer-based system that has at least a processor,database, and payer interface; establishing and storing in memory a nextavailable set-aside date and a due date for a next required payment;determining and storing in memory a payment amount for the next requiredpayment; establishing and storing in memory compliance preferencesincluding a preferred set-aside period and amount per period to be setaside; calculating and storing in memory a set-aside schedule as afunction of the next available set-aside date, the due date, the paymentamount, and the compliance preferences, the calculated set-asideschedule that includes a plurality of set-aside amounts and a pluralityof corresponding set-aside dates, whereby a total of the set-asideamounts is at least equal to the payment amount; displaying thecalculated set-aside schedule to the payer; enabling the payer to acceptor adjust the calculated set-aside schedule and, if adjusted,overwriting the stored set-aside schedule with the adjusted set-asideschedule.

The method may include or require recalculating the adjusted set-asideschedule based on stored data; displaying the recalculated set-asideschedule to the payer; and enabling the payer to accept or adjust thecalculated set-aside schedule and, if adjusted, overwriting the storedset-aside schedule with the adjusted set-aside schedule. The method maybe repeated once or periodically, or whenever the user is summoned by asystem notice or decides to access the system for information or to takeaction.

The method may include the computer-based system having data links toselected financial institutions controlling selected financial accounts,and further provide for transferring an amount of funds equal to thescheduled set-aside amount, on the scheduled set-aside date, by means ofone or more data messages, from a source account associated with thepayer to a holding account wherein set-aside amounts are accrued untilthe due date; transferring the payment amount, on the due date, by meansof one or more data messages, from the holding account to a receivingaccount associated with a beneficiary of the obligation; and storing inmemory a record of the transferred amount as a reduction to the holdingaccount and a corresponding reduction to the obligation. The record maybe stored as merely a pending reduction of the obligation in accordancewith pre-established rules of the financial institutions until thetransfer of the payment amount is confirmed; and then be updated as aconfirmed payment. The holding account being associated with the payeras an escrow account, perhaps interest bearing, and over which the payerhas continuing control including final authorization as to making apayment or reclaiming the funds for other purposes.

Determining the payment amount of the next required payment may involveentering and storing an estimated total amount for the obligation;determining and storing amounts of previous payments and creditsreducing the obligation; calculating and storing the next payment amountas a function of the total amount of the obligation less the previouspayments and credits, and the terms of the obligation by which paymentintervals, due dates and amounts are determinable. The obligation may bean estimated one year tax obligation in accordance with U.S. InternalRevenue Code, where the payments are quarterly payments in accordancewith requirements for estimated tax obligations under the InternalRevenue Code. The method may utilize any of the aforementioned equationsor other suitable algorithms for calculating optimal set-aside schedulesto meet payment requirements for tax or other types of obligations.

The invention contemplates multiple payers subject to respectiveobligations, with respective holding accounts being associated with acommon third party payment service. It further contemplates multiplepayers such as taxpayers subject to respective obligations, such as taxobligations, of which there is a common beneficiary, such as the IRS.

The computer-based system may have data links to selected financialinstitutions controlling selected financial accounts, and the method mayinclude storing in memory a record relating to a source accountassociated with the payer so as to identify an amount of set-aside fundsin a source account equal to the scheduled set-aside amount, on thescheduled set-aside date, by means of one or more data messages, wherebythe record indicates the accrued amount of set-aside funds in the sourceaccount until the due date; and transferring the payment amount, on thedue date, by means of one or more data messages, from the source accountto a receiving account associated with a beneficiary of the obligation;and storing in memory a record of the transferred amount as a reductionto the source account and a corresponding reduction to the obligation.

The source account of a payer may be multiple source accounts associatedwith a common payer, and his compliance preferences may include rules bywhich set asides are charged to selected source accounts, includingstock or other types of asset accounts where a set-aside is obtained bya loan from a third party with the asset account performing ascollateral, all of this being executed by data messages according topre-established rules and payer preferences. Likewise, the payer mayhave multiple obligations being serviced by the system and method of theinvention, where his compliance preferences include rules by which setasides and corresponding payments are allocated among the variousobligations.

In another variation of the invention, the payer subject to a financialobligation may be multiple tax payers subject to respective estimatedtax obligations of which the Internal Revenue Service is a commonbeneficiary, wherein the computer-based system has data links toselected financial institutions controlling selected financial accounts,and the method further provides for transferring an amount of fundsequal to the scheduled set-aside amount, on the scheduled set-asidedate, by means of one or more data messages, from individual sourceaccounts associated with respective taxpayers to a respectivesub-account of a common holding account, wherein set-aside amounts arecombined but accrued on behalf of the respective taxpayer until the duedate; and transferring by batch file instructions the combined paymentamount, on the common due date, by means of one or more data messages,from the holding account to an Internal Revenue Service receivingaccount, with instructions for apportioning the combined payment amongthe respective individual taxpayer tax accounts; and storing in memoryfor the payers' review and benefit a record of the transferred amount asa reduction to the holding account and the sub-accounts of theindividual taxpayers and a corresponding reduction to their respectiveindividual tax obligations.

The foregoing description of the embodiments of the invention has beenpresented for the purposes of illustration and description. It is notintended to be exhaustive or to limit the invention to the precise formdisclosed. Many modifications and variations are possible in light ofthis disclosure. It is intended that the scope of the invention belimited not by this detailed description, but rather by the claimsappended hereto.

What is claimed is:
 1. A computer-enabled method for improvingcompliance of a plurality of taxpayers subject to respective estimatedtax obligations to a common taxing authority by use of periodicset-asides of funds sufficient to make required payments in accordancewith terms of the obligations, the method comprising: using acomputer-based system including a processor, database, at least onetaxpayer interface, and data links to selected financial institutionscontrolling selected financial accounts for establishing and storing inmemory for each of the estimated tax obligations a next availableset-aside date and a due date for a next required payment, the due datebeing common for all of the estimated tax obligations; determining andstoring in memory for each of the estimated tax obligations a paymentamount for the next required payment; ascertaining and storing in memoryfor each of the taxpayers compliance preferences including a preferredset-aside period and an amount per period to be set aside; calculatingand storing in memory for each of the estimated tax obligations aset-aside schedule as a function of the next available set-aside date,the due date, the payment amount, and the compliance preferences, thecalculated set-aside schedule comprising a plurality of set-asideamounts and a plurality of corresponding set-aside dates, whereby atotal of the set-aside amounts is at least equal to the payment amount;displaying to each taxpayer the set-aside schedule calculated for theestimated tax obligation applicable to the taxpayer; enabling eachtaxpayer to accept or adjust the applicable calculated set-asideschedule and, if adjusted, overwriting the stored set-aside schedulewith the adjusted set-aside schedule; for each of the taxpayers,according to the applicable calculated set-aside schedule, transferringan amount of funds equal to the scheduled set-aside amount, on thescheduled set-aside date, by means of one or more data messages, from atleast one individual source account associated with the taxpayer to arespective sub-account of a common holding account, wherein set-asideamounts are combined but accrued on behalf of the respective taxpayersuntil the due date; transferring by batch file instructions the combinedpayment amount, on the common due date, by means of one or more datamessages, from the at least one holding account to a receiving accountof the taxing authority, with instructions for apportioning the combinedpayment among the respective individual taxpayers; and storing in memorya record of the transferred amount as a reduction to the holding accountand the sub-accounts of the individual taxpayers and a correspondingreduction to their respective individual estimated tax obligations. 2.The method of claim 1, wherein the taxing authority is the United StatesInternal Revenue Service.
 3. The method of claim 1, further comprisingusing the computer-based system to repeat the establishing, determining,ascertaining, calculating, displaying, and enabling for a plurality ofsequentially required payments and associated due dates.
 4. The methodof claim 1, wherein at least one of the holding accounts is associatedwith at least one of the taxpayers as an escrow account.
 5. The methodof claim 1, further comprising: recalculating the adjusted set-asideschedule based on stored data; displaying the recalculated set-asideschedule to the taxpayer; and enabling the taxpayer to accept or adjustthe calculated set-aside schedule and, if adjusted, overwriting thestored set-aside schedule with the adjusted set-aside schedule.
 6. Themethod of claim 1, said determining the payment amount of the nextrequired payment comprising: entering and storing an estimated totalamount for the estimated tax obligation; determining and storing amountsof previous payments and credits reducing the estimated tax obligation;and calculating and storing the next payment amount as a function of thetotal amount of the estimated tax obligation less the previous paymentsand credits, and the terms of the estimated tax obligation by whichpayment intervals, due dates and amounts are determinable.
 7. The methodof claim 6, wherein calculating a set-aside schedule includescalculating each set aside amount S_(n) using an equationS _(n)=(T/I)/P _(i) where the individual set-aside periods are indexedby the variable n, T is the total amount of the financial estimated taxobligation, the total number of required payment intervals is I, thepayment intervals are indexed by the variable i ranging from 1 to I, andP_(i) is the number of set-aside periods available in the paymentinterval in which the n′^(th) set-aside period occurs.
 8. The method ofclaim 6, wherein calculating a set-aside schedule includes calculatingeach set aside amount S_(n) using an equationS _(n)=(T/I)(L/D _(i)) where the individual set-aside periods areindexed by the variable n, T is the total amount of the financialestimated tax obligation, the total number of required payment intervalsis I, the payment intervals are indexed by the variable i ranging from 1to I, L is the fixed set-aside period length in days, and D_(i) is thenumber of days in the i′^(th) payment interval.
 9. The method of claim6, wherein calculating a set-aside schedule includes calculating eachset aside amount S_(n) using an equation$S_{n} = {{\left( {T/I} \right)\left( {L/D_{i}} \right)} - {\left( {O - {\sum\limits_{j = 1}^{K}\; S_{j}}} \right)/\left( {N - K} \right)} + A_{n}}$where individual set-aside periods are indexed by the variable n rangingfrom 1 to N, S_(n) is the set-aside amount for the n′^(th) set-asideperiod, T is the total amount of the financial estimated tax obligation,L is the fixed set-aside period length in days, D_(i) is the number ofdays in the i′^(th) payment interval, O is an overpayment made towardthe estimated tax obligation before the first set-aside date, K is thevalue of n at the first set-aside date, and A_(n) is an individualadjustment made by the taxpayer to S_(n).
 10. The method of claim 6,wherein calculating a set-aside schedule includes calculating each setaside amount S_(n) using an equationS _(n)=(T/I)/MIN(P _(i)) where the individual set-aside periods areindexed by the variable n, T is the total amount of the financialestimated tax obligation, the total number of required payment intervalsis I, the payment intervals are indexed by the variable i ranging from 1to I, P_(i) is the number of set-aside periods available in the paymentinterval in which the n′^(th) set-aside period occurs, and MIN(P_(i)) isthe minimum value of P_(i) for all values of i.
 11. The method of claim6, wherein calculating a set-aside schedule includes calculating thelength Ln of each set-aside period using the equationL _(n) =D _(i)/MIN(P _(i)) where the individual set-aside periods areindexed by the variable n, T is the total amount of the financialestimated tax obligation, the total number of required payment intervalsis I, the payment intervals are indexed by the variable i ranging from 1to I, P_(i) is the number of set-aside periods available in the paymentinterval in which the n′^(th) set-aside period occurs, D_(i) is thenumber of days in the i′^(th) payment interval, and MIN(P_(i)) is theminimum value of P_(i) for all values of i.
 12. The method of claim 1,further comprising: for at least one of the taxpayers, storing in memorya record relating to a source account associated with the taxpayer so asto identify an amount of set-aside funds in a source account equal tothe scheduled set-aside amount, on the scheduled set-aside date, bymeans of one or more data messages, whereby the record indicates theaccrued amount of set-aside funds in the source account until the duedate; transferring the payment amount, on the due date, by means of oneor more data messages, from the source account to a receiving accountassociated with the taxing authority; and storing in memory a record ofthe transferred amount as a reduction to the source account and acorresponding reduction to the estimated tax obligation.
 13. The methodof claim 1, wherein a plurality of source accounts is associated with atleast one of the taxpayers, said compliance preferences for saidtaxpayer including rules by which set aside amounts are distributedamong said source accounts.